If a production possibilities frontier is a downward sloping straight line, it
A. shows that there are no trade-offs in the production process.
B. shows that resources are not efficiently allocated
C. shows that production on the frontier implies that it is not possible to produce more of anything without producing less of something else.
D. shows that resources are unemployed.
Answer: C
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The ____ is the absolute value of the slope of an indifference curve
a. marginal rate of substitution b. average rate of transitivity c. relative rate of utility d. marginal rate of transposition
Long-run average total cost must always be
a. rising b. declining c. greater than or equal to the marginal unit of variable cost d. greater than or equal to the short run average total cost e. less than or equal to short-run average total cost
Regulation began in the United States in the 1950s.
Answer the following statement true (T) or false (F)
Classical economists believed that
A. if saving exceeded investment, prices and interest rates would rise as business accumulated unwanted inventories. B. flexible prices and wages could not restore an economy to full employment if the interest rate were rigid. C. flexible interest rates, wages, and prices would assure full employment. D. voluntary unemployment reflected economic inefficiency.